With tobacco buyout as history, coal country wary of a Clinton plan falling short

As Kevin Widener was growing upon his family’s tobacco farm in the rolling hills of southwest Virginia in the 1990s, lawmakers and lawyers in Washington were waging a war on smoking.

In 2006, as part of a larger program to help failing tobacco farmers, the federal government purchased the Widener homestead, and a separate legal settlement with the tobacco industry paid for Widener to attend community college, the start of a successful transition to nursing.

His mother, Sheila Snapp, now unemployed and surviving on government disability payments, was not so successful. “The tobacco money made a big difference for my son,” Snapp said while waiting for her clothes to dry at the Lost Sock Coin Laundry. “But it didn’t change anything for the rest of us.”

Now Washington is gunning for the second pillar of the Appalachian economy, coal, and again, a politician, Hillary Clinton, is promising to help — with $30 billion over 10 years to revitalize coal country.

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As in the case of tobacco, the idea is not to save the old economy, but to create a new one through retraining miners, investing in infrastructure and technology and luring new industries.

Residents here are skeptical, and with good reason, some economists say. Much of the tobacco rescue came from a 1998 settlement between tobacco companies and more than 40 states, requiring the companies to pay more than $200 billion over 25 years to help the victims of tobacco — both those afflicted by cancer and lung disease, and those hurt economically by the decline of the industry.

In turn, lawmakers in Virginia created the Tobacco Region Revitalization Commission, which has spent nearly a billion dollars.

The government can’t really help Appalachia. The tobacco settlement was a rip-off. They ripped us up one side and down the other.

Gary Lambert, a retired coal machinist who also sold his tobacco farm to the federal government

The commission and similar programs helped send some young people like Widener to college. It also spent money on projects similar to what Clinton proposes: building broadband networks and retraining in fields such as computer repair. It lured a major government contractor, Northrop Grumman, to build an office here, and built several call centers for companies like Verizon and TurboTax.

But southwest Virginia is still suffering.

“The government can’t really help Appalachia,” said Gary Lambert, a retired coal machinist who also sold his tobacco farm to the federal government. “The tobacco settlement was a rip-off. They ripped us up one side and down the other.”

The settlement did pay for one of his sons, Thad, to go to college and become a teacher at the local high school. Another son, Brad, is back in the firing line: He’s a coal miner.

“I guess if you want to survive, you have to change,” Lambert said outside Pat’s Kountry Diner in Lebanon. He said things had gotten so bad that meth was so cheap in the area that no one even made moonshine anymore.

Clinton’s advisers say her plan to save coal country is informed by the lessons of the tobacco programs. Trevor Houser, the plan’s chief architect and an energy economist who grew up in coal-dependent Wyoming, spent two weeks last summer traveling through coal towns there and in Appalachia, meeting with miners, mayors and local boards and councils, to get an understanding of what is needed, what works and what does not.

“We understand that each coal community is different,” Houser said. “What works in southeast Ohio is not necessarily going to work in southwest Virginia.”

The spending would include a mix of basic infrastructure, such as road and sewage connections, along with new broadband, internet and cellphone technology, tax incentives for companies to locate in the region, and spending on projects such as turning old coal mines into industrial parks.

There will also be efforts to promote tourism, with projects like converting coal fields into parks for all-terrain vehicles.

Some senior coal country Republicans, including Sen. Mitch McConnell of Kentucky, the majority leader, and Rep. Harold Rogers of Kentucky, chairman of the House Appropriations Committee, have also teamed up with Democrats to support their states’ economies.

The plan also calls for more spending on schools, modeled after a 1990s-era program to help schools in the Pacific Northwest after environmental regulations hit the lumber industry.

And Clinton has something of a secret weapon to sell it: her running mate, Tim Kaine, the senator and former governor of Virginia, who has close ties in the region. His father-in-law is A. Linwood Holton Jr., a Republican and former Virginia governor who is from Big Stone Gap, in the heart of this region. And his wife, Anne Holton, has maintained her ties to Appalachia.

Some senior coal country Republicans, including Sen. Mitch McConnell of Kentucky, the majority leader, and Rep. Harold Rogers of Kentucky, chairman of the House Appropriations Committee, have also teamed up with Democrats to support their states’ economies.

But residents of southwest Virginia, 19 percent of whom live in poverty, can be forgiven for their skepticism.

“I’m a lawyer. I rarely get offended by an offering of money to redress a wrong,” said State Sen. Ben Chafin, a Republican, who watched the decline of his father’s tobacco farm. “But $3 billion a year won’t even be enough to buy everyone a custard cone.”

Porterfield Highway illustrates the region’s economic reality with its mix of billboards advertising high-speed broadband services and also rural aid programs to feed hungry children. In the tiny, largely boarded-up town of Sun, Virginia, Roger Bentley, a retired miner, recalled that more than a decade ago, Reynolds Metals Co. built a factory here, lured by tax incentives to bring in non-tobacco companies. “But after the tax breaks run out,” he said, “they left.”

William M. Shobe, the director of the Center for Economic and Policy Studies at the University of Virginia, said that as tobacco and coal decline, the best option for workers might simply be to leave.

“Retraining is fine, but without mobility, much of the value of that retraining will be lost,” he said. “You will have coal miners retrained in computer skills, but working in retail or not working at all.”

The tobacco commission did have some successes, Chafin said. The problem, he said, is that many of the college-educated workers at Northrop Grumman are not local. And the new call center jobs pay about $12 an hour – far less than a coal miner’s annual salary of $60,000 to $80,000.

“It’s hard to think of what other kind of retraining you give to coal miners,” he said. “There just isn’t enough here – and it’s dubious to say that broadband will save us.”

A 2015 study by the left-leaning Economic Policy Institute on the employment impacts of President Barack Obama’s climate change policies found that overall, the initiatives would cut jobs in industries like coal mining, but increase jobs in industries like wind and solar development, leading to a net gain of 24,342 jobs by 2030.

Retraining is fine, but without mobility, much of the value of that retraining will be lost. You will have coal miners retrained in computer skills, but working in retail or not working at all.

William M. Shobe, the director of the Center for Economic and Policy Studies at the University of Virginia

But that number, the study showed, includes a loss of 202,238 jobs associated with coal mining and coal-fired power generation in regions where they might not be replaced by the 256,177 new jobs associated with the manufacture of energy-efficient lighting and heating and cooling systems.

“It’s not going to be easy,” Houser said. “The green shoots of diversified growth are showing up a lot more slowly than the rapid decline of coal. You’re not going to flip a switch and suddenly have a robust diversified economy in southwest Virginia.”

In Wise, Va., a few miles from Kentucky, Jack Kennedy, a circuit court official and a technophile who campaigns for the town’s economic development, is optimistic that the region could rebound as a center for technology. He is working to bring in companies that specialize in cybersecurity and drone technology. At least one firm, he said, has already flown a cargo drone from the town’s Lonesome Pine Airport.

“This is the perfect place for industries like drones and cybersecurity, because we’re so remote,” Kennedy said. “The drone industry is new. We can grow with it.”

Kennedy also pointed to OptaFuel, a lab that is researching and developing biofuels made from sawdust. The company started the lab in Wise because of tax breaks offered by the tobacco commission – and it brought highly educated employees like Vrusank Patil, an engineer who grew up in India, and Clint Ivey, a production manager who grew up in Georgia.

“If it wasn’t for the tobacco commission,” Ivey said, “we wouldn’t be here.”

About half of the team of 35 chemists, many dressed in skinny jeans and lab coats, are recent graduates from the University of Virginia’s small campus in Wise, he said. OptaFuel also employs a few former coal miners as security guards.

But, he conceded, “for the research jobs, you need a bachelor’s degree” — something most former coal miners do not have.